Marriott and Accenture are currently engaged in a battle that is challenging the certification of multiple classes in a data breach case. This marks the second time but with new arguments that could influence future class actions and the applicability of class action waivers. The case at hand is Marriott International, Inc., Customer Data Security Breach Litigation, which is now being appealed.
Class action waivers are often found within arbitration clauses and they require buyers to forfeit their right to launch a class action or representative action. These waivers work with arbitration clauses to mandate a consumer’s agreement not to initiate class actions in court. The district court found that such waivers can also be waived, as demonstrated in the recent Marriott case—a verdict that Marriott has since appealed.
The case involves several class action lawsuits against Marriott for allegedly failing to take reasonable measures to safeguard personal information, which was exposed in a 2018 data breach affecting approximately 133 million people in the US. The case also encompasses claims against Marriott’s IT provider, Accenture LLC. Marriott’s appeal argues that the district court committed an error by certifying classes against it without first recognizing its class action waiver defense during the certification stage. The Fourth Circuit court overturned the district court’s ruling and sent the matter back to the district court to assess the impact of the class action waiver before judging on class certification.
However, the district court later reinstated the certification for several of the previously approved classes, stating that Marriott had relinquished its class action waiver by behaving inconsistently with that waiver during the proceedings. As a result, Marriott and Accenture are now appealing the district court’s class certification order.
Marriott further challenges the district court’s decision that a class action waiver can be implicitly waived solely by participating in multidistrict litigation with bellwether procedures, claiming no other court in the country has made such a ruling so far. They also dispute the decision that the class action waivers are inherently “adhesive” and unfair. Moreover, Marriott disagrees with the court’s ruling that the Federal Rules of Civil Procedure 23 and 42 prohibit class action waivers.
The consequences of this case could have a significant impact on the enforcement of class action waivers in consumer contracts going forward. Marriott’s current appeal, predicated on the specific class action waivers in its case, may carry potential implications for the fundamental viability of class action waivers in consumer contracts. The outcome of this case might affect how enforceable these contracts are in the future.
The case is referenced as Maldini v. Marriott International, Inc.
For more detailed information about the case, read here.